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Saving the euro is in all our interests and EU must now act decisively

EUROPE and the euro have been in the news for all the wrong reasons. As crisis after crisis has unfolded, it is understandable that Irish and European citizens have questioned the credibility of the EU. We are all concerned for our future. It is time we put heads together to find answers.

Part of the problem is the scale and rapidity of the economic deterioration in the eurozone. Europe, by its very nature, is slow to respond.

We have always been excellent at inching towards agreement and finding consensus. In many respects, this has been the essence of the EU's success. But speed has never been its forte.

Sadly, the 'inch-by-inch' approach no longer works. The proper functioning of the eurozone is essential to the EU's very existence.

We urgently need to find a solution. The first step must be that we all accept this is not a so-called 'peripheral' problem. Recent signs are more encouraging than they had been.

German Finance Minister Wolfgang Schauble has stated: "The confidence crisis triggered by Greece is now jeopardising the euro as a whole."

This is an important and necessary acknowledgement by Europe's largest and most successful economic power.

This crisis affects all members of the eurozone. The European institutions, particularly the commission and the parliament, have actually been the loudest proponents of radical action from an early stage.

It is the member states themselves that have been short-sighted in identifying and pursuing a solution.

Last week's Eurogroup meeting made significant progress. Ministers reaffirmed their commitment to safeguard financial stability in the euro area.

They said they're ready to adopt measures including "enhancing the flexibility and the scope of the European Financial Stability Facility, lengthening the maturities of the loans and lowering the interest rates, including through a collateral arrangement where appropriate".

The Irish Government has consistently put these proposals forward at EU level, so we are pleased that they are finally being accepted. However, we need to go further.

One credible solution is that of eurobonds. This would create a sort of unified bond market, whereby governments in the eurozone would pool some of their debt instruments. The effect would be that these eurobonds would mutualise national public debts.

It would involve the so-called 'core' countries taking on substantial exposure from the so-called "peripherals".

This may seem unpalatable to countries that are still borrowing on the international markets. However, it presents all of us with a more comprehensive and definitive solution than we have so far seen.

Commissioner Olli Rehn has told the European Parliament that the commission will examine how best to introduce Eurobonds.

This discussion cannot go on too long. For Ireland and other countries at risk of Greek contagion, such as Italy and Spain, a swift implementation of this is crucial.

I can quite understand why certain countries have concerns but we all benefit hugely from the existence of the euro and cannot afford to see it fail.

Lucinda Creighton is Minister for European Affairs at the Department of an Taoiseach

Irish Independent